Singapore private home price index up 0.5% in Q4, 2.7% for 2019

THU, JAN 23, 2020 - 9:15 AM
UPDATED THU, JAN 23, 2020 - 11:51 AM

SIOW LI SEN


SINGAPORE'S private home price index rose 0.5 per cent in Q4 2019 over the prior quarter, faster than the 0.3 per cent flash estimate released on Jan 2, according to the latest data from the Urban Redevelopment Authority (URA) on Thursday.

For the full year of 2019, prices were 2.7 per cent higher, versus the 7.9 per cent rise in 2018.

In Q3 2019, the index rose 1.3 per cent.

In Q4 2019, prices of landed properties increased by 3.6 per cent, after rising 1 per cent in Q3.

Prices of non-landed properties fell 0.3 per cent in Q4, compared with a gain of 1.3 per cent in Q3.

For the whole of 2019, prices of landed properties rose by 5.7 per cent, while those of non-landed properties rose by 1.9 per cent, slower than the 6.3 per cent and 8.3 per cent in 2018.

Giving a breakdown by region, URA said that prices of non-landed homes in the prime areas or core central region (CCR) in Q4 went down 2.8 per cent after rising 2 per cent in Q3.

In the city fringe or rest of central region (RCR), prices of non-landed homes fell by 1.3 per cent after chalking up a gain of 1.3 per cent in Q3.

In the suburbs or outside central region (OCR), prices of non-landed homes appreciated 2.8 per cent; it was up 0.8 per cent in the previous quarter.

URA's rental index for private homes fell 1 per cent versus up 0.1 per cent in Q3. For the whole of 2019, rentals of private residential properties increased by 1.4 per cent, faster than 0.6 per cent in 2018.

Developers launched 2,226 uncompleted private residential units (excluding executive condominium or EC units) for sale in Q4 from 3,628 in Q3. For the whole of 2019, they launched 11,345 compared with 8,769 in the previous year.

They sold 2,443 private homes (excluding ECs) in Q4 compared with 3,281 in Q3. Full year 2019 sales was 9,912 units, compared with 8,795 units in 2018.

The highest number of private home sales was 22,197 in 2012.

The highest quarterly sales was 4,538 units sold in Q2 2013.

Developers did not launch any EC units for sale in Q4, they launched 820 in Q3 2019; they sold 59 EC units in Q4 against 426 EC units in Q3. For 2019 they launched 820 ECs and sold 505, compared with 628 units launched and 1,136 sold in 2018.

There were 2,342 resale transactions in Q4, which accounted for 48 per cent of all sale transactions in the quarter. For 2019, there were 8,949 resale transactions, compared with 13,009 in 2018.

There were 93 sub-sale transactions in Q4; for 2019, there were 289 sub-sale transactions, compared with 335 sub-sale transactions in 2018.

As at the end of 2019, there was a total supply of 49,173 uncompleted private home units (excluding ECs) in the pipeline with planning approvals, compared with 50,964 units in Q3. Of this, 30,162 units remained unsold at the end of 2019, lower than the 31,938 units in Q3.

After adding the supply of 3,192 EC units in the pipeline, there were 52,365 units in the pipeline with planning approvals. Of the EC units in the pipeline, 2,100 units remained unsold.

In total 32,272 units (including ECs) remained unsold, down from 34,089 in Q3 and 35,649 a year ago.


ANALYSTS' COMMENTS:

Lee Nai Jia, Knight Frank Singapore, head of research:

"The increase in prices and higher new sales figures indicate that there is a genuine, underlying demand for private residential homes in 2019. Notwithstanding, the residential market appears to have become highly segmented, with some segments performing better than others. For instance, the landed residential price index rose by 5.7 per cent for the whole year, while the price index of non-landed properties in the CCR decreased by 1.7 per cent.

"Moving forward, we expect the momentum to continue, although the external environment may play a large role in dictating price movements. We expect the price index for all properties to go up by 2 per cent to 5 per cent in 2020, and sales to be a shade higher than in 2019. We also foresee more purchases from HDB upgraders, with the HDB resale market showing more liquidity after the introduction of the higher income ceiling and improved subsidies for potential buyers."

Christine Li, Cushman & Wakefield, head of research, Singapore and South-east Asia:

"All things considered, 2019 was a relatively good year for the private residential market. Though total volumes fell by 13.5 per cent to 19,150 units, overall private property prices managed to grow 2.7 per cent. Developers sold a total of 9,912 units, surpassing 2018ís sales by 12.7 per cent. However, resale volumes fell by 31.2 per cent y-o-y to 8,949 units as en bloc activities went quiet after the last round of cooling measures in the second half of 2018. Short-term speculative activities still remained suppressed, going by low sub-sale volumes at only 289 units for the whole of 2019.

"In sum, the increase in new sales transactions and growth in overall prices is testament to the resilience of private residential property. The outperformance of the RCR and OCR markets over the CCR market shows that the market remains heavily characterised by cooling measures and buyer demand continues to gravitate towards affordable and reasonably-priced projects.

"In 2020, we expect the market trends to be similar to 2020, given that market fundamentals remain unchanged: interest rates are expected to remain low, while the economy is expected to improve slightly in 2020."